Weir backs out of bid to buy Finnish group Metso

Deal would have been valued at $15.4 billion

By

EdBallard

LONDON — Scottish engineer Weir Group PLC has ended its pursuit of Metso Oyj after its Finnish rival rejected a second multibillion-dollar bid.

Weir
WEIR, -1.16%
said Wednesday that Metso’s
MEO1V, -0.87%
board refused to engage in talks regarding an improved all-share offer earlier this month and rejected the proposal on May 27, claiming the bid undervalued its prospects.

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The Scottish company added that it believes it made a compelling proposal but remains financially disciplined and as such doesn’t intend to pursue Metso further.

Based on the combined market capitalization of the two companies, which both make equipment for the energy and mining industries, the deal would be valued at $15.4 billion.

Under the terms of the revised offer from Glasgow-based Weir, Metso shareholders would have got 0.95 Weir shares for each Metso share, a 13% increase to Weir’s previous offer of 0.84 shares, which Metso rejected in April.

In addition, Weir proposed a special dividend to be paid after the merger worth €2.13 ($2.9) a share for Metso shareholders.

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